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Oil prices advance amid U.S. supply tightness signals By Reuters


© Reuters. FILEPHOTO: A photograph of crude oil storage tanks at Cushing Oil Hub in Cushing (Oklahoma), U.S. April 21, 2020. REUTERS/Drone Base/File Photo

TOKYO (Reuters) – Oil prices rose on Tuesday as analysts pointed to signs of U.S. supply tightness, ending days of losses as global markets remain haunted by the potential impact on China’s economy of a crisis at heavily indebted property group China Evergrande.

The price of a barrel rose by 52 cents, or 0.7%, to $74.44 by 0212 GMT. It had fallen almost 2% by Monday. After dropping 2.3% during the previous session, West Texas Intermediate’s contract (WTI) was higher by 61c or 0.9 to $70.90.

Global utilities have switched to oil because of rising prices for gas and coal and lingering disruptions in the Gulf of Mexico following Hurricane Ada, which imply that less is available.

The ANZ Research noted that “while slowing Chinese economy growth and uncertainty over the (U.S. Fed) Fed’s tapering timeline weighed on market sentiment”, other developments continued to suggest higher oil prices.

Financial assets investors have all been affected by Evergrande’s fallout and the risk of another market turmoil. [MKTS/GLOB]

Markets are also being affected by the wider state of China’s economic economy. The U.S. Federal Reserve will likely tighten monetary policy. This is likely to increase investor fear of oil and other riskier assets.

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